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	Company Credit Analyses for a Credit Hedge Fund
	One of the key factors for a hedge fund’s success in the hyper-efficient corporate bond market is the ability to rapidly acquire the right information, and synthesize it into actionable data. Our client, a multi-billion dollar US-based hedge fund, sought to do exactly that. As a credit hedge fund, our client needed to understand the capital structures, debt covenants and free cash flows of the companies that they are monitoring. This highly relevant information - on the thousands of companies that the fund monitors - helps our client make real-time investment decisions, giving them a decided advantage. Creating such a repository with up-to-date and accurate analysis on companies was an enormous task that created many challenges for our client. For one, they would need a pool of resources with highly specialized skills, not merely in financial analysis, but specifically credit analysis – a skill set that is not found easily. In addition, the time to set up a team and then create and maintain the analysis would be significant. Without the desire to spend several millions of dollars on new staff, or add operational complexity, our client decided to look for external assistance, and as a result turned to Copal Partners.
	Copal Partners had the in-house talent and operational expertise to undertake such a challenge. First, Copal created a template which would allow for the client to view all the necessary data and analysis in a standardized format. Using profiles designed specifically for this purpose, managers at our client were able to see a company’s business description, capital structure, covenant analysis, peer group analysis, and free cash flow forecast. With millions of dollars potentially being put in-play with profiles generated by Copal Partners, data integrity and consistency were paramount. Copal’s solution was fully auditable, and driven by rigorous process, adding to the funds’ confidence in Copal’s output. Every piece of financial data was supplemented with a note providing information on source, date, page number and other information to allow for easy traceability. In addition, methodology documents and process flows outlining every step from initial team staffing to final quality checks made Copal’s work completely transparent.
	To meet the demands of the scope of the project, Copal deployed a 10-person dedicated team that created the initial profile templates and continued to update and maintain the analysis. The team was trained on our client’s methodologies making Copal’s solution an India-based external office for the fund. The client would interface with the Copal team as if it were communicating with its own employees. Copal provided the fund with access to India’s talented and low-cost workforce without the hurdles of hiring, training or managing an offshore operation.
	The creation of the credit profile database of over 1000 companies, and the specialized analyses produced by the dedicated team at Copal gave our client  an edge that few other investors could match. The fund could now interpret the output of these analyses in real-time rather than waiting for them to be completed in-house and hoping the market had not moved in the interim. The fund was able to get quality and support that exceeded expectations at a price below half of  what it would cost them without Copal’s involvement.